Adelstein calls for FCC payola investigation

FCC commissioner Jonathan Adelstein called for an investigation of payola practices uncovered by New York Attorney General Eliot Spitzer, based on the announcement of a settlement with Sony BMG Music Entertainment.

While Spitzer’s investigation focused on the music industry and radio, Adelstein related the pay-for-play practice to the ongoing concern over the use of video news releases during television newscasts. Both involve a broadcast station receiving something of value in exchange for using the airwaves to promote a song or idea without disclosing the exchange took place.

Adelstein has asked the public to help the FCC monitor and enforce the rules against airing undisclosed promotions, including VNRs and product placements.

At Adelstein's urging, the commission issued a unanimous Public Notice on Video News Releases and a fact sheet on payola. In the notice, the FCC said the payola rules “are grounded in the principle that listeners and viewers are entitled to know who seeks to persuade them with the programming.”

If the investigation determines a broadcast licensee has violated sponsorship identification rules, the FCC may impose a fine of up to $32,500 per violation and initiate license revocation proceedings.

A new report from U.S. PIRG showing retailers are generally misinforming the public about the DTV transition reveals a symptom of a larger failure to coordinate consumer education on the matter, said FCC commissioner Jonathan Adelstein.